After weeks of fierce public debate about the future of the 27 Market St. site in Oneonta, Mayor Mark Drnek proposed Tuesday that the city postpone any action on selling the city-owned property until October.
“What’s important to me, more important even than this project right now, is having united community,” Drnek said.
Rehabilitation Support Services Inc. — which provides mental health and substance abuse services, including housing and employment assistance — proposed redeveloping the slightly larger than a half-acre of property at the corner of Chestnut and Market streets into a $25 million mixed-use building, with about 40 low-income housing and 15 units set aside for RSS clients.
RSS introduced its proposal publicly in late December. Since then, dozens of members of the public have spoken out against the plan, many of whom organized a public meeting to solidify their opposition.
The city Common Council was slated to hold a closed-door executive session at a special meeting Tuesday, March 26 to discuss a proposed purchase and sale agreement for 27 Market St. A vote on the sale was scheduled for April 2.
Drnek said that he wants the council to be invested in determining the minimum requirements of any developer to which the city would sell the parcel.
“We have now time for the council to determine how do we want to reach out to developers and see what we have,” he said.
The redevelopment of the 27 Market St. site has been a multi-year process, and the property had been on the market for several years before the city bought the property in 2020.
According to a development timeline issued by the city, a food and beverage innovation center was pitched in 2015 by Otsego Now using an Empire State Development grants totaling $3.7 million.
Otsego Now submitted a Restore NY application for 27 Market St. demo in October 2016. The city completed and submitted a DRI strategic investment plan that proposed the priority projects to be funded with the DRI grant, including the food and beverage center in March 2017.
Otsego Now was awarded a $477,915 Restore NY grant to demolish 27 Market St. and transferred it to the city.
In May 2017, the governor’s office awarded the DRI projects but did not award any funding to the food and beverage center due to negative publicity, according to the city’s timeline.
From 2017 to 2018, then Mayor Gary Herzig expressed interest to the owners in purchasing the site relative to development of a mixed-use building at 27 Market St. Herzig also was in contact with developers to build a multi-use building at 27 Market St. or the Westcott Lot, which was provided DRI funding.
In August 2018, KCG Cos. submitted a proposal to Herzig to access the existing $477,000 Restore NY grant funds for redevelopment of 27 Market St. in conjunction with their intended redevelopment of the Westcott Lot.
In October 2018, Market Street Alliance LLC executed purchase agreement for 27 Market St. with then owners Kenneth Hart and Robert Racine to develop a commercial use building, effectively ending city negotiations and any public project at the site until this deal fell through in 2020.
Market Street Alliance withdrew the purchase agreement in July 2019, according to the city’s timeline.
On Jan. 21, 2020, the city executed a purchase agreement for 27 Market St. to purchase the site for $425,000 from Hart and Racine.
In June 2021, the city hired Delaware Engineering with subcontractor Mathis Public Affairs for the Market Street development project, utilizing a $100,000 marketing effort paid with DRI funds.
The consultants issued RFPs to more than 100 developers with a due date of November 5, 2021, looking for a developer for a transit hub at 27 Market St.
The city received a letter of interest on Aug. 26, 2021, and an update on Dec. 10, 2021, from an interested developer. The developer ultimately did not invest, according to the city’s timeline.
In April 2022, Delaware Engineering provided an updated cost estimate to demolish the building for $1.8 million. As a result, the city submitted an application to ESD through the Consolidated Funding Application for an additional $333,400 grant to help fund the demolition of the building at 27 Market St. This grant was not awarded.
In October 2022, the city submitted an application to ESD for a $12 million Restore NY grant to assist Klugo Properties with demolishing the building at 27 Market St. and reconstruction of a $15 million mixed-use building, but this grant was not awarded and the developer withdrew the plan.
In February 2023, Drnek and city staff met with RSS to discuss potential downtown housing project above the proposed public parking project at 47 Market St., according to the city’s timeline.
Communication and efforts continued over the next several months to develop this concept, which was ultimately set aside in favor of a project proposed for 27 Market St.